After years of litigation, the Pagosa Area Water and Sanitation and San Juan Water Conservancy districts have agreed to the terms of a settlement with Trout Unlimited in the case of the proposed Dry Gulch Reservoir.

The local chapter of TU brought forth litigation in 2004 over concerns that the then 35,000 acre-foot reservoir and accompanying rights for diversion and refill amounted to a water grab on the part of PAWSD.

Six years later, the PAWSD and SJWCD boards voted to allow their lawyer, Evan Ela, of the Denver law firm Collins Cockrel & Cole, to prepare a final decree to be submitted to and approved by District Court Judge Greg Lyman, hopefully closing the case.

The two boards made the decision following an executive session with Ela and water engineer Steve Harris at a joint meeting held on Dec. 1.

Following the executive session, the boards made the decision and voted to release a letter between Ela, Sen. Bruce Whitehead and Trout Unlimited’s attorney, Andrew Peternell, which outlines the terms of the agreement.

As indicated by the Nov. 16 letter from Ela, he met with Whitehead and Peternell, Nov. 5 to discuss the terms and conditions.

As defined in the letter, the settlement terms control the reservoir storage volume, diversion rate, limitations on use, a “reality check” and more, as follows:

• The decree will allow 4,700 acre-feet of new storage, and will allow it to be in addition to the existing 6,300 acre-feet storage right, thus defining the reservoir’s capacity as 11,000 acre-feet.

The decree also allows for a refill water storage right to allow “successive refills throughout the 12-month accounting year,” to be limited by annual maximums.

• In the final decree, a total maximum diversion rate of 50 cfs will be specified, “which can be diverted for direct use, into storage, or in part for both purposes, so as to limit total diversion for the Dry Gulch Project to 50 cfs.”

• The settlement also includes a limit on the total annual volumetric limit.

Including the existing 6,300 acre feet storage right, the new 4,700 acre-feet storage right, the refill water storage, and the 50 cfs diversion right, diversions “shall not exceed 11,000 acre-feet per year” and “shall be further limited to no more than 9,300 acre-feet in a rolling ten-year average of such total combined diversions.”

• Should stream flow drop to or below 100 cfs between March 1 and Aug. 31, or to or below 60 cfs between Sept. 1 and Feb. 29, direct use, storage and refill rights will be limited.

“This is a victory for the San Juan River,” said Peternell, who also serves as director of Trout Unlimited’s Colorado Water Project in a press release. “The original application could have been devastating to fish habitat and the river ecosystem, but now we have a settlement that balances the districts’ need for water with the health of the San Juan.”

• All water diverted under the decreed water rights are to be used within the PAWSD and SJWCD service areas as they exist now or in the future.

• The letter also lists a “Reality Check” and a settlement term, which, in part, includes that, “As part of diligence proceedings and proceedings to make absolute the conditional portions of the water rights decreed herein, the Districts are required to make showings that the volumetric yield of the conditional water rights has been or will be need by the Districts’ projected growth.”

To assess that need, the court can consider the districts’ current demand, projected demand growth, as well as a look at the use or disposition of the districts’ water rights.

If it is determined that the districts do not need the volume of water, the court can cancel all water rights confirmed in the decree.

In explaining the agreement on Dec. 1, Ela said that all the water rights in question were junior water rights, with the oldest dating back to 1965.

• The final decree will also include language indicating the districts agree that they will abandon five different conditional water rights held by the districts if they have not been used or perfected by the date the Dry Gulch facilities have been constructed, as well as the “portions of the Dry Gulch Project water rights not needed for the final constructed configuration of the Dry Gulch Project.”

• Lastly, the final decree “shall contain a finding that the decree terms are administrable by State Water Officials.”

“This is huge,” said Carrie Weiss, SJWCD board member, after thanking Ela and Harris for their work. “Six years later, it’s nice to put this to rest.”

“The settlement underscores that municipal water projects must be based on well-founded, substantiated data about future growth and water needs,” Peternell said in the press release. “In a time of water scarcity, Colorado must embrace water solutions that meet a range of needs, including municipal growth, agriculture and wildlife and recreation. No water user can take more than its fair share.”

While the result of the executive session was straightforward, the choice to enter into executive session was not.

A movement by a number of PAWSD board members, including Allan Bunch, aimed to move the executive session to the end of the meeting in order to move a separate discussion about Dry Gulch ownership and financing up on the agenda (see related article).

Bunch’s reasoning behind the move was to accommodate audience members (the most important people at the meeting, he said) who were at the meeting for the second Dry Gulch discussion, instead of making them sit through an executive session of unknown length.

PAWSD board chair Steve Hartvigsen maintained that there was some linkage between the topics, but that one did not depend on the other.

Members of the SJWCD board, including Weiss, voiced that the agenda had been posted before the meeting, alerting interested public of the executive session.

Weiss continued that she thought the executive session could come into play in the later discussion and didn’t want the boards to be reluctant in the open discussion by not knowing the outcome of the executive session.

After the boards decided to enter into executive session (though not formally, by motion), the public left the room, only to be called back minutes later for another discussion on the order of the agenda and an official motion to enter into executive session at the point indicated on the agenda.

Though litigation with Trout Unlimited should soon cease, it is still unclear whether or not Dry Gulch Reservoir will be built, when or by whom.